Tanzania: Bulyanhulu Project-01/Kankola
Lawyers Environmental Action Team (LEAT)
$56.25 million (Guarantee)
Bulyanhulu Gold Mine is an underground mine and mill complex established by Kahama Mining Corp. Ltd (KHMC). The area in which the project is situated is an area where small scale miners have been highly active for many years. In January 2002, the Lawyers Environmental Action Team (LEAT) lodged a complaint with CAO on behalf of the Small Scale Miners Committee of Kakola, Tanzania expressing the following concerns:
1. The process of consultation regarding eviction and land clearance as well as resettlement and compensation of small scale miners in 1996;
2. The transfer of concession to Barrick Gold upon its acquisition of Sutton Resources and the consequent resettlement of people in 1998;
3. Failure of MIGA to neither conduct thorough and competent due diligence nor address issues through consultation;
4. Human rights abuses as a result of the eviction process
In 1994 the Government of Tanzania (GOT) granted a prospecting license to KHMC, a subsidiary of Sutton Resources. In June 1999, Barrick Gold obtained the property by purchasing Sutton Resources. In July 1995, GOT decreed that all small scale miners should leave the area, but action was not taken to ensure that the land was vacated. Barrick’s acquisition of the property ended IFC’s potential involvement in the project, however MIGA remained involved as a political risk insurer.
In the Assessment Report, completed in October 2002, CAO highlighted that it did not believe that the project merited a compliance audit and were impressed with the way in which the mine was developing its social and environmental capacity. Following a site visit in March 2001, CAO determined that the available evidence indicated that the mine was not in fact culpable for the deaths of 52 miners. Furthermore, CAO found that the claims concerning the extent of forcible relocation were distorted. Finally, it was determined that the mines’ activities were in conformity with best practice as applicable to the mining industry. CAO stressed the unique opportunity posed by this project for all relevant parties to strengthen their partnership in order to achieve greater investment in local peoples. The complainants' response to CAO’s assessment was unfavorable and the case was closed in January 2005.